Form It-20s - Indiana S Corporation Income Tax Return - 2014 Page 23
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32Instructions for Schedule IN K-1,
Part 2 - Distributive Share Amount
Complete lines 1 through 13 for the shareholder. Also provide
Shareholder’s/Partner’s Share of
the shareholder with a statement showing his distributive share of
Indiana Adjusted Gross Income,
income, credits, and modifications.
Deductions, Modifications, and Credits
Line 1 through Line 13b. For full-year Indiana resident
Enclose each shareholder’s IN K-1 with Form IT-20S. Also, provide a
shareholders, complete these lines as shown on the federal Schedule
completed copy of Schedule IN K-1 to each shareholder.
K-1, Form 1120S.
Note: Contact the department for alternative filing options for
For most nonresident shareholders, the federal Schedule K-1
Schedule IN K-1 at (317) 232-0129. For information on the
amounts should be multiplied by the Indiana apportionment
acceptable electronic data file format, visit the department’s website
percentage. This is calculated on the Schedule E (see the instructions
at
beginning on page 15). The apportioned amounts should be entered
on lines 1 through 13b. If any entries on lines 2 – 11 represent
Part 1 - Shareholder’s/Partner’s Identification
nonbusiness income to the S corporation, these amounts are
allocated to the appropriate state.
Section
Complete Schedule IN K-1 to identify each shareholder.
Line 4, “Guaranteed payments, ” is for those filing an IT-65. Leave this
(a) Enter the name of the shareholder, if an individual, and Social
line blank.
Security number.
(b) Enter other entity name if the shareholder is another entity or
Line 6, “Ordinary dividends, ” corresponds to line 5a on the federal
a fiduciary, and enter the federal identification number.
K-1. Line 9, “Net long-term capital gain (loss), ” corresponds to line
(c) Enter the shareholder’s state of residence or commercial
8a on the federal K-1.
domicile.
(d) Enter the FID of the payment entity and the amount of tax
On line 13a or 13b, include investment interest expenses attributed
withheld on income distributions derived from Indiana
to royalty income and all other federal deductions. (This excludes
sources for any nonresident shareholder for the taxable
those treated as itemized deductions.) Do not report any other type
year from either the IT-6WTH remittance or the WH-1
of investment interest expense, itemized deduction, or carryover loss
remittance. A WH-18, Indiana Miscellaneous Withholding
on this line.
Tax Statement for Nonresidents, must be prepared for
the nonresident shareholders that have opted out of the
Note: If the corporation has received any distributions from other
composite filing and whose withholding has been remitted
entities having income previously apportioned to Indiana, use the
into a nonresident withholding account by the S corporation.
following method to report distributive share income for Schedule
Do not include any penalty or interest paid on delinquent
IN K-1.
withholding tax. If no withholding tax was paid or if
additional withholding tax is due on opted-out shareholders,
Alternative Completion of Schedule IN K-1 Information for Part 2 –
use INtax to make payment. Credit for any amount withheld
You must use an alternative application of Schedule IN K-1 if:
must be claimed on the shareholder’s Indiana individual
•
A shareholder is a nonresident individual, fiduciary, or trust;
or fiduciary tax return. Enclose any WH-18s with amounts
and
withheld on behalf of this entity by another flow-through
•
The corporation had income from outside Indiana.
entity.
Example: Partnership A provides S corporation B a
Use the following method for completing Schedule IN K-1 when the
WH-18 indicating amounts of Indiana state tax withheld.
corporation had any apportioned income from outside Indiana or is
S corporation B does not claim the withholding credit
otherwise required to complete the Indiana apportionment schedule.
and passes the credit through to its shareholders. Proper
withholding credit is reflected by each S corporation B
Modify each required Schedule IN K-1 line entry by recalculating the
shareholder on the Indiana K-1. S corporation B must
pro rata share of total S corporation income with required Indiana
enclose copy A of the WH-18 with its Indiana IT-20S return.
modifications to adjusted gross income reported on line 1 of Form
If the S corporation has withholding liability in addition to
IT-20S. Use the pro rata amount from line 13A, Worksheet for
the pass-through withholding, S corporation B issues a
S Corporation Distributive Share Income, Deductions, and
WH-18 to each of its nonresident shareholders for this
Credits (worksheet), by applying these steps:
additional income only. This amount should be included on
Part 1 line (d), and copy A of the WH-18 should be enclosed.
Step 1. Deduct from the above pro rata share the respective pro rata
(e) Enter the applicable pro rata percentage of the shareholder’s
amount of line 13B and line 14B of the worksheet.
interest in the S corporation. The percentage should be
adjusted to an annual rate if necessary.
Step 2. Multiply the result by the Indiana apportionment percent
(f) Enter the shareholder’s tax as computed on Schedule
reported on line 4 of Form IT-20S, from Schedule E, line 8, if present.
IT-20SCOMP, column F.
This amount should reflect the shareholder’s proportionate share of
this S corporation’s activity in Indiana.
17
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